Ballard Monetizes Non-Core Investment for $44.5 Million
22 December 2009 - 4:30PM
PR Newswire (US)
VANCOUVER, Dec. 21 /PRNewswire-FirstCall/ -- Ballard Power Systems
(TSX: BLD; NASDAQ: BLDP) announced that it has closed an agreement
effective today with a financial institution to monetize its rights
under the Share Purchase Agreement with Ford Motor Company (Ford)
relating to Ballard's 19.9% equity interest in Automotive Fuel Cell
Cooperation Corp. (AFCC). Ballard will receive total gross proceeds
of approximately $44.5 million: a $37 million payment today and a
further contingent payment of $7.5 million due upon maturation of
the Share Purchase Agreement on or before January 31, 2013.
Ballard's receipt of the contingent payment is subject to the
financial institution's rights in the transaction remaining
unsubordinated. Bruce Cousins, Ballard's Chief Financial Officer
said, "Given the recent improvement in public debt market
conditions and Ford's credit rating, we believe that this is the
appropriate time to monetize this non-core investment". John
Sheridan, Ballard's President & CEO said, "The cash proceeds
from this transaction bolster Ballard's strong balance sheet and
strengthen our positioning to execute our clean energy growth
priorities in backup power, supplemental power, distributed
generation and motive power applications". Ballard expects to book
a gain associated with this transaction of approximately $34
million in its fourth quarter results. This transaction does not
affect Ballard's business relationships with AFCC, Daimler, Ford,
and their affiliates. Ballard will continue to supply technical
services and fuel cell components and modules. Background As part
of the monetization agreement, Ballard has pledged its shares in
AFCC and assigned its right to "put" or sell those shares to Ford
for $65 million plus interest after January 31, 2013. The value of
the monetization of the agreement with a financial institution was
determined based on a number of variables, including Ford's cost of
borrowing, expected future London Interbank Offered Rates (LIBOR),
time remaining to the Share Purchase Agreement's maturity date and
general market and other conditions. All required approvals from
Daimler AG, Ford and AFCC were received prior to the closing of
this transaction. Ballard's intellectual property rights are
unaffected by this transaction. Lazard Freres & Co. LLC acted
as a financial advisor to Ballard for the transaction. About
Ballard Power Systems Ballard Power Systems (TSX: BLD; NASDAQ:
BLDP) is a clean energy growth company with product leadership in
fuel cell power solutions, initially on the material handling and
stationary power markets. To learn more about Ballard, please visit
http://www.ballard.com/ This release contains forward-looking
statements that are provided to enable external stakeholders to
understand our expectations as at the date of this release and may
not be appropriate for other purposes. These forward-looking
statements are based on the beliefs and assumptions of Ballard's
management and reflect Ballard's current expectations as
contemplated under section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Such assumptions relate to Ballard's financial forecasts
and expectations regarding its product development efforts,
manufacturing capacity, and market demand, and include matters such
as generating new sales, producing, delivering and selling the
expected number of units, and controlling its costs. These
statements involve risks and uncertainties that may cause Ballard's
actual results to be materially different, including, without
limitation, the rate of mass adoption of its products, product
development delays, changing environmental regulations, its ability
to attract and retain business partners and customers, its access
to funding, increased competition, its ability to protect its
intellectual property, changes in its customers' requirements,
foreign exchange impacts on its net monetary assets and its ability
to provide the capital required for product development, operations
and marketing. For a detailed discussion of these risk factors and
other risk factors that could affect Ballard's future performance,
please refer to Ballard's most recent Annual Information Form.
Readers should not place undue reliance on Ballard's
forward-looking statements and Ballard assumes no obligation to
update or release any revisions to these forward looking
statements, other than as required under applicable legislation.
Ballard and the Ballard logo are registered trademarks of Ballard
Power Systems Inc. DATASOURCE: Ballard Power Systems Inc. CONTACT:
or to arrange an interview with a Ballard spokesperson, please
contact Lori Rozali at telephone number (604) 453-3683 or on e-mail
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